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Administration Announces Major Colombia FTA Breakthrough

April 8, 2011

The U.S. wheat industry applauded a Wednesday announcement from the Obama Administration that negotiators have reached an agreement that should speed passage of a long-pending free trade agreement with Colombia.

The U.S. and Colombia signed the agreement in November of 2006, but it has yet to be submitted to Congress for final approval because of political disputes and concerns about labor rights in the South American country.

In the meantime, countries including Canada have negotiated their own agreements with Colombia, eroding and threatening U.S. market share, including U.S. wheat growers’ market share, there. Colombia announced last week that its agreement with Canada could be implemented as early as July 1, which may effectively cost U.S. wheat growers $100 million in lost sales.

The centerpiece of the new breakthrough includes an “Action Plan Related to Labor Rights” the Administration said “will lead to greatly enhanced labor rights in Colombia and clear the way for the U.S.-Colombia Trade Agreement to move forward to Congress.”

The announcement was not specific as to the agreement’s path toward passage, but is still a significant advancement towards closing the deal and was praised by key Members of Congress and parts of the private sector, including the wheat industry.

Wednesday afternoon, NAWG and U.S. Wheat Associates released a joint statement on the announcement, saying it is “a critical step toward being able to compete on a level playing field in one of the largest wheat markets in South America.”

“U.S. wheat producers need this FTA to compete in the Colombian market on the basis on quality and supply with wheat from other countries,” said NAWG President Wayne Hurst and U.S. Wheat Associates Chairman Don Schieber, wheat producers in Idaho and Oklahoma, respectively.

“We encourage the Obama Administration to prepare and submit the FTA to the House of Representatives for a ratification vote as soon as possible.”

The wheat industry strongly supports all three pending FTAs – with Colombia, Panama and South Korea – though the Colombian agreement would have the most economic impact on the wheat industry.

In recent weeks, there has been a growing movement in Congress to urge that all three pending agreements move at once.